Lean Six Sigma is a business methodology that aims to reduce defects and waste. The term was conceived in 1986 at the electronics company Motorola, and while it usually applies to manufacturing, it has a long record of being applied successfully to many other industries including information technology, telecommunications, sales, healthcare, finance and even the military.
What is Lean?
Lean refers to reducing waste in a business. Waste is anything that doesn’t benefit your bottom line or add value to an organization.
Regularly waiting for product shipments, having processes that go days without being actioned, and products sitting in a room until they are needed can all be considered waste.
The purpose of Lean management is to synchronize business processes so there is no downtime and operations run as smoothly as possible.
A lean approach helps companies eliminate activities that are devoid of value. A major benefit of this is the ability to deliver the same value to customers but with less effort.
As such, Lean does not mean making employees work harder and faster; a lean strategy will simply give employees more time to spend on the value-adding processes that will add to the business's bottom line.
What is Six Sigma?
If Lean is about streamlining processes, Six Sigma is about improving the quality of what the business delivers, ensuring that variation is kept to a minimum.
Six Sigma refers to a method of statistical quality control and is effectively a data-driven problem-solving methodology. Like Lean, it has its origins in manufacturing. Named after the mathematical symbol for a standard deviation (sigma), Six Sigma is the ideal acceptable range of deviation from an ideal mathematical measurement which is 3.4 defects per million output units. That means 99.99966 percent of all processes should be completed without any inaccuracies or defects.
Related article: Why Lean Six Sigma is poised for a comeback in 2023
Many companies take on Six Sigma because it sets a goal that is in the realms of perfection – but realistic enough giving employees across an organization the desire and motivation to meet it.
Imagine if a busy train station had one million departures and arrivals every year. At Sigma level 4 there would be 5000 mistakes. Is that good enough?
At Sigma level 6 there would only be two mistakes.
Conversely, take a mobile phone that has thousands of components that must be assembled correctly to ensure the device works. A deviation worse than 99.9% would likely result in a device that does not work.
Related content: The eight deadly wastes of Lean
The goal of Lean and Six Sigma is to eliminate waste, optimize processes, foster business process management and improve the quality of your product or service.
To summarise, Lean aims to clean up the activities between the value-adding processes and Six Sigma is about improving the outcome of the processes and the work being done.
Lean Six Sigma is a must for businesses of every size as it makes quality a quantifiable statistic. It enables businesses to observe and study processes in a scientific way with the end goal of eliminating waste.
How to succeed with 12 essential lean six sigma strategies
1. Cellular manufacturing
Cellular manufacturing is a lean manufacturing approach for process improvement. It is defined by two core characteristics: grouped components and manufacturing cells. In cellular manufacturing, families of parts are created in a cell of machines.
A cell is an area of production that is clearly defined and separated from other manufacturing cells – with each cell having ultimate responsibility for the family of parts and components. Think of cells like mini production facilities within a larger production facility. This is referred to as group technology.
It is an alternative to the traditional production line. A production line refers to one continuous line of workers that add value to the product from receiving the raw material to the finished product.
The major downside of a production line is that a disruption in any part of the line can halt the entire process as each component relies on the components that precede it.
Related article: What is Lean?
Cellular manufacturing involves the re-arrangement of workstations to facilitate production characterized by continuous flow and less downtime.
In the world of manufacturing, all operations and machines that are needed to produce a component are placed in close proximity, specifically a ‘U’ shape. By doing this workers spend less time moving between manufacturing lots and more time adding value to the component.
By having equipment and workstations arranged in a sequence that supports logic, you can achieve one-piece flow. Also known as single-piece flow and continuous flow, one-piece flow is when products move through the manufacturing process at a rate determined by the needs of customers.
Tips for cellular manufacturing:
• Group components together
• Organize manufacturing cells into groups and sets
• Envision your final product as the result of a number of modules and groups of components attached together
2. Takt time
Takt time refers to the rate at which a finished product is completed to meet customer demand. It is an essential tool for discerning if goods are flowing from each station to the next in an efficient manner, ensuring customer demand is met.
In German, ‘takt’ means rhythm. In that sense, takt is the rhythmic pulse of a company, and like a music conductor, Takt time provides the means to measure processes to ensure continuous flow and the optimal utilization of machines and processes.
The mathematical calculation for takt time is as follows:
The time available for production should reflect the number of time employees spend working on the product, minus variables such as meetings breaks and other related activities. Conversely, customer demand is a measure of how many products a customer expects to buy.
Both these variables should be consistent over the same time frame, such as a day or a week.
Related article: Four steps for implementing continuous improvement
Takt time is not the number of hours put into creating a product. It refers to the entire time span to create a product, from start to finish, ensuring that continuous flow is achieved and customer demand is satisfied.
Takt time is effectively your sell rate and is a good measurement of how efficient work processes are. Ideally, an optimal organization should have capacity that can easily meet demand without having too much stock in inventory. Utilized effectively, Takt time can promote efficiency, helping a company to measure waste and easily discern which areas of production are struggling, are on schedule, or otherwise need to be adjusted.
An example of Takt time:
Total time: 8 hours X 60 minutes = 480 minutes
Breaks: 50 minutes
Time available: 430 minutes
Customer demand in 8 hours: 100 units
Takt time: 430 / 100 = 4.3 minutes = 258 seconds
In this example, the customer will need one unit every 258 seconds.
However, you might like to produce a single unit in little less than 258 seconds to accommodate any variation in process steps. It is vital that before you implement takt, you ensure that processes are dependable, can deliver good quality and that machines have a very high uptime.
3. Standardized work
Standardized work is a simple concept referring to the process of documenting methods, processes, materials, tools and processing times. At its core, it is about ensuring operations run as smoothly as possible and the process improvement strategy is constantly evolving and being adopted by employees. Standardized work is very important to reaching the ideal Takt time.
Benefits of standardized work:
• Best practices are followed
• Process improvement never ends
• Reduces waste
• Improves scaling efforts
• Makes abnormalities more visible
• Less time spent on guesswork
Tips for standardizing work:
Ensuring that your employees are using best practices is one of the best ways to increase efficiency. If you want to promote a working environment characterized by standardized work, you need to ensure that standardization requirements are reasonable and have scope for improvement.
Ignoring the wishes of employees who will use these standards every day may lead to a less efficient work environment as innovation will be stifled. Standardization is simply eliminating alternative methods that are less efficient. Ultimately, this means standardization is more suited to tasks that are repeatable and cyclical.
Communication is key to ensuring standards are established. This entails:
• Finding a process or task that is repeatable.
• Establishing an ideal Takt time for completing this process.
• Establishing the work sequence and method that is needed to perform each element of work.
• Communicating clearly how the job can be performed
4. One piece flow
One piece flow, also known as continuous flow, emphasizes reducing batch size to eliminate system constraints. It is a methodology by which a product or information is produced by moving at a consistent pace from one value-added processing step to the next, with no delays in between.
5. Kanban pull system
With a Kanban pull system, a customer process signals a supplying process to produce a product or information when it is needed.
A pull system refers to JIT (Just-in-Time) efficiency, where the product meets customer demand, not exceeds it. With a pull system you will have an easier time responding to market forces, but it is chiefly about making what the customer wants when they want it.
Related article: What is operational excellence?
On the other hand, Kanban refers to the signals used within a pull system via scheduling, combined with travel instructions in the form of simple visual cards and containers.
This is in contradiction of ‘conventional wisdom’ which states that a company should complete products in large batches. This kind of methodology is called a push system, which is a methodology where the product is completed before the customer is ready to receive it. The major downside of this system is that keeping inventory costs money, as does keeping process busy for the sake of it.
Benefits of a Kanban pull system:
- More capital: Less money will be invested in storage space for inventory.
- Increased market dynamism: Whether it is market forces that affect scalability or an aspect of the product itself, it can be damaging to have inventory consisting of un-sellable products.
- Less work in progress (WIP).
- Improved production environment: Kanban provides visual clarity and can promote objective and rational discussion among team members.
- Easy monitoring: All team members will have a constant feedback of their performance via a breakdown of every stage from start to finish.
Tips for using a Kanban pull system:
There are three steps to successfully introducing a Kanban pull system into the work environment:
1. Map your workflow. Visualizing your workflow it easily definable segments is the core aspect of Kanban. Whether you use a physical Kanban board or a digital version, they typically have three sections representing the state of your product. These are: requested, in progress, and done.
2. Pull in work. When you start to receive work only pull in new work if there is concrete demand for it.
3. Manage bottlenecks and work in progress. The purpose of your Kanban board is to enable a smooth workflow. You have to ensure your processes don’t get clogged by putting limits on the amount of WIP cars up at any given time.
6. Five whys
The five whys are a tried and true method of analyzing and solving a problem. With the five why’s you can often get to the root cause of an issue – instead of applying a quick fix which will ultimately lead to the same issue rearing its head in the future.
Asking yourself why is important because it helps find the fastest way of getting to the root cause of a problem, cutting through the symptoms and getting right to the underlying issues.
Tips for using the five whys:
You can use this method to gain an in-depth understanding of a problem, as opposed to filling in the blanks yourself. This makes it great for troubleshooting, but not necessarily problem solving.
The five whys test is also beneficial because it prevents succumbing to tunnel vision and focusing on a single cause when there could be multiple.
It is always a good idea to repeat the test while giving alternative answers, or asking a co-worker to perform the five whys for comparison. This also means you can go beyond fives whys, so the key is to stop the exercise when the answers become unactionable or no more useful responses are given.
Example of the five whys:
Problem: We missed a customer delivery deadline
Why was the deadline missed? Because we sent out the product one day late
- Why was the product sent out late? Our customer management system wasn’t updated to reflect the new batch of orders
- Why was the database not updated? Because it was under maintenance
- Why was the update not finished in time? There are vacant positions open in the IT department which has increased turnaround times
- Why are there vacant positions in IT? Several members of the IT staff are on holiday at the same time
7. Quick changeover/SMED
SMED is the Single Minute Exchange of Dies, which is a process of reducing changeover time by categorizing machine elements as internal or external, and then converting the internal elements so they can be changed externally while the machine is still running.
A 3-stage methodology developed by Shigeo Shingo reduces the time to changeover by externalizing and streamlining steps. Shorter changeover times are used to reduce batch sizes and produce Just-in-Time. This concept helps to reduce the setup time to improve flexibility and responsiveness to customer changes.
Benefits of SMED:
• Less downtime and improved responsiveness to customers.
• Work-in-progress and lot size reduction.
• Improved machine/resource utilization.
• By increasing the number of changeovers, we can carry less inventory of raw materials, supplies and finished goods.
• Become more efficient and identify opportunities for continuous improvement
8. Mistake proofing
This is a methodology that prevents an operator from making an error by incorporating preventive in-built responsiveness within the design of product or production processes.
Mistake proofing can be applied to most processes, but areas where it can prove vital include instances where a certain process has been identified that results in frequent human error; in situations where the customer can make an error; when a minor error turns into a major error; or when at any point where an error will lead to major disruption.
Benefits of mistake proofing:
• Promotes accountability and process improvement
• Relatively low effort and not very time consuming
• Makes sure that proper circumstances exist before the actual creation, and prevents defects from taking place.
• Identifies and eliminates causes of disruption
This process improvement methodology is comprised of these steps:
• Creating a flowchart of the process.
• Reviewing each step
• Determining where there is a potential error finding it at its source.
• Eliminate the source of error or reduce its effect
• Replace the error with a process that is error proof
9. Levelling the workload
This is the idea that, although customer order patterns may be quite variable, all processes should build consistent quantities of work over time (day to day, hour to hour).
This strategy is adopted by intelligently planning different product mixes and volumes over a period of time.
10. Total productive maintenance (TPM)
A team-based system for improving Overall Equipment Effectiveness (OEE), which includes availability, performance and quality. This helps establish a strategy for creating employee ownership autonomously for equipment maintenance.
The goal of the TPM program is to markedly increase production while at the same time increasing employee morale and job satisfaction.
11. 5S methodology
5S is a five-step methodology aimed at creating and maintaining an organized visual workplace for continued process improvement and efficiency.
This is a very practical system aids for analyzing the current organizational space and removing what isn’t necessary.
The 5S are:
Sorting out. This step entails going through all of your work tools and materials to determine what is needed and what is not. To find the value of each item, ask yourself:
• What is the purpose of this item?
• Why is it here?
• How often is it used?
• Who uses it?
• Cannot find useful answers to these questions? You probably do not need it.
Set in order. Once the unnecessary clutter has gone, you can rearrange the workspace to align with the goals and immediate requests of your team.
Sweep. Create a plan for regular maintenance and cleaning for tools and equipment.
Sweep. Create a plan for regular maintenance and cleaning for tools and equipment.
Standardize. Turn one-time efforts into habits. Whether if its an online checklist or verbal reminders, set aside time to help foster an environment where tasks become routine.
Sustain. Ensure long-term sustainability. Whether you’re a manager or new starter, everyone needs to be on board with the new program. This is why documenting procedures and ensuring they are easy to find is so important for process improvement.
12. Problem solving/PDCA
The PDCA cycle is a four-phase graphical model for carrying out change at your organization. PDCA stands for plan, do, check and act.
The method is cyclical, so the PDCA / PDSA cycle should be repeated over and over. It is a good idea to use this model at the start of a process improvement project, especially for processes that are repetitive.
Plan: Find a problem or opportunity as set out a plan for continuous change. You will need to create a hypothesis for what potential issues may be.
Do: This is the testing phase. Realistically, this will be a small scale test where you can easily measure results and gain a greater understanding of your hypothesis
Check: Assess if the problem is fixed.
Act: If the initial test was successful, repeat it on a bigger scale.
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